Rarely-seen Phaeton is top VW saloon now sold mainly in Europe

Rarely-seen Phaeton is top VW saloon now sold mainly in Europe

Volkswagen plans to launch a new luxury sedan, codenamed 511, under the VW brand and only in China.

Reuters, citing anonymous sources, said the model, intended to improve group profit margins, would be launched at the end of 2015. The automaker plans to sell 50,000 a year.

The sedan, based on the Audi A6, was designed in Europe.

A person with knowledge of the plan said: "Selling luxury cars makes for fatter profit. Volkswagen believes this segment will continue to grow rapidly. Premium models under the VW brand will be especially attractive to those who want a superior car but don't want to [attract] too much attention."

Meanwhile, over the next three years, the Shanghai Volkswagen joint venture plans to open 100 upscale dealerships in China.